Suppose that good X and good Y are substitutes and good X and good Z are complements. When the price of a good Y _____ or the price of good Z _____, the demand for good X shifts outward.

Question

Quizplus · Accepted Answer

When the price of a substitute good (Y) increases, consumers are more likely to purchase good X instead, leading to an outward shift in the demand for good X. Similarly, when the price of a complementary good (Z) decreases, it becomes more affordable, and consumers are more likely to buy both the complement (Z) and good X, also shifting the demand for good X outward.

Suppose That Good X and Good Y Are Substitutes and Good